Payment cards such as credit or debit cards are ubiquitous and for decades such cards have included a magnetic stripe on which the relevant account number is stored. To consummate a purchase transaction with such a card, the card is swiped through a magnetic stripe reader that is part of the point of sale (POS) terminal. The reader reads the account number from the magnetic stripe. The account number is then used to route a transaction authorization request that is initiated by the POS terminal.
A prominent payment card system is operated by the assignee hereof, MasterCard International Incorporated, and by its member financial institutions. FIG. 1 schematically illustrates a typical transaction, as carried out in a payment system 100. To initiate the transaction, a customer (not shown) visits a retail store (not shown) operated by a merchant, selects goods (not shown) that he/she wishes to purchase, carries the goods to the merchant's point of sale equipment 104, and presents his/her payment card 102 to the point of sale equipment 104. The point of sale equipment 104 reads the customer's payment card account number from the payment card 102, and then sends an authorization request to an acquirer financial institution (FI) 106 with which the merchant has a relationship. The authorization request includes the payment card account number and the amount of the transaction, among other information. The authorization request is routed via a payment card system 108 (which may be, for example, the well-known Banknet system operated by the assignee hereof) to the issuer financial institution (FI) 110 that issued the customer's payment card 102. Arrows 112, 114 and 116 trace the path of the authorization request from the POS terminal 104 to the issuer 110.
Assuming that all is in order, the issuer FI 110 transmits a favorable authorization response to the point of sale equipment 104 through the payment card system 108 and via the acquirer FI 106. The path of the authorization response from the issuer FI 110 to the POS terminal 104 is traced by arrows 118, 120 and 122. The transaction at the point of sale equipment 104 is then completed and the customer leaves the store with the goods. A subsequent clearing transaction initiated by the merchant results in a transfer of the transaction amount from the customer's payment card account 124 to an account that belongs to the merchant. The customer's payment card account 124 may be, for example, either a debit card account or a credit card account. In the former case, the clearing transaction results in the funds being debited directly from the account 124. In the latter case, the clearing transaction results in a charge being posted against the account 124, and the charge subsequently appears on the customer's monthly credit card statement.
The foregoing description of the typical transaction may be considered to be somewhat simplified in some respects. For example, a merchant processing system (not shown) may be interposed between the POS terminal and the acquirer FI. As is familiar to those who are skilled in the art, a merchant processing system may be operated by or on behalf of the merchant to form part of the communications path between the acquirer FI and POS terminal operated by the merchant. It is also often the case that a third party transaction processing service may operate to handle payment card transactions on behalf of the acquirer and on behalf of a large number of other like financial institutions.
In pursuit of still greater convenience and more rapid transactions at the POS terminal, payment cards have more recently been developed that allow the account number to be automatically read from the card by radio frequency communication between the card and a proximity reader or terminal 126 which may be incorporated with the POS terminal 104. In such cards, often referred to as “proximity payment cards” or “contactless payment cards”, a radio frequency identification (RFID) integrated circuit (IC) or tag 128 is embedded in the card body 102. A suitable antenna is also embedded in the card body and is connected to the RFID chip to allow the chip to receive and transmit data by RF communication via the antenna. In typical arrangements, the RFID chip 128 is powered by an RF interrogation signal that is transmitted by the proximity reader 126 and received by the card antenna.
MasterCard International Incorporated, the assignee hereof, has established a widely-used standard known as “PayPass” for interoperability of contactless payment cards and proximity readers.
In the PayPass system, at checkout a tiny microchip and a radio antenna embedded in a PayPass-enabled device wirelessly transmit payment details to a PayPass reader when the PayPass-enabled device is brought in close proximity (“tapped”) to the reader. In the following data exchange, such as used in the PayPass system, will sometimes be referred to as “contactless”. The reader on the POS terminal then verifies the transaction with the issuer FI through, for example, MasterCard's reliable network and indicates approval almost instantly.
The PayPass reader includes a keypad that allows a cardholder to enter a Personal Identification Number (PIN) used by the payment system to authenticate the cardholder.
The capabilities of a contactless payment card be incorporated into a mobile telephone, thereby turning the mobile telephone into a contactless payment device. Typically a mobile telephone/contactless payment device includes integrated circuitry with the same functionality as the RFID IC of a contactless payment card. In addition, the mobile telephone/contactless payment device includes a loop antenna that is coupled to the payment-related IC for use in sending and/or receiving messages in connection with a transaction that involves contactless payment.